Burlington, Vermont’s attempt to sell its cable and broadband provider may finally be completed this evening as city councilors consider a resolution to approve a sales contract.
In 2009 it was revealed that Burlington Telecom, the city-owned telecommunications utility, had spent $17 million in taxpayer money without authorization for operations costs. An eventual settlement with CitiBank and other entities required that Burlington Telecom be sold.
Eight bidders initially came forward. It was late fall when the city council halved that to four: Keep Burlington Telecom Local, Schurz Communications, ZRF and Ting, a division of Tucows. Mayor Miro Weinberger then eliminated ZRF, citing a conflict of interest.
At the end of October the highest bidder, Ting, at 2$7.5 million, and the local coop Keep Burlington Telecom Local, with a bid of $12 million dollars, were the favored choices. City councilor Karen Paul recused herself from the vote citing a conflict of interest. That led to the council postponing the decision. By the next week Councilor Paul said she had resolved the conflict and rejoined discussions. The council’s vote was evenly split between Ting and KBTL. The two were asked to try to create a partnership and return to the council with a plan. The idea failed, giving rejected bidders Schurz Communications and ZRF another shot. Those two companies formed a partnership and during the course of a council meeting adjusted the agreement, and the council approved the Schurz/ZRF bid.
Tonight the Burlington City Council will hold a special session to authorize the mayor to enter into the formal Asset Purchase Agreement with Schurz/ZRF. City Council President Progressive Jane Knodell says it is the only piece of business the council will consider and is the final vote on the sale. “There will be a presentation about the agreement before the public forum. Then councilors will have an hour and a half to ask questions and make sure everyone understands the content and the public can be there. This will all be in open session. And then we’ll go to vote and discussion on that one resolution. The expectation is that everyone has, all councilors, have vetted their issues with the city attorney and that people are ready to vote on what’s before us.”
Keep Burlington Telecom Local Board Member David Lansky has looked at the final agreement and still has many concerns. “What we’re left with is a family run business that could work really well but we don’t have community control over it.”
If the resolution is approved by the city council and authorized by Mayor Weinberger the sale must then be approved by the Vermont Public Utility Commission. If that happens, Knodell says the city will partner with Schurz for the state regulatory process. “Schurz needs to get a Certificate of Public Good in order then to move on to the closing.”
Keep Burlington Telecom Local member Dean Corren notes that city residents have the right to intervene in the state regulatory process. “Remember the first vote of the various bidders Schurz got one vote and the coop got the most votes and Schurz was out of it completely. It came back in literally after the eleventh hour, after the midnight hour, one night with a sort of a provisional approval without any even proper bid to look at. This is after a multi-year process. And the whole process could not be more flawed. So we hope the PUC (Vermont Public Utility Commission) will turn down this agreement and then we can start from scratch again and put together a proper process that people can respect.”
The special session of the Burlington City Council begins at 6 p.m. at Contois Auditorium in City Hall.